China has agreed to use crude oil from its national strategic stockpile during the Chinese New Year celebrations as part of a plan in which the US is teaming up with other major oil consumers to crash global prices, Reuters informed.
A source told Reuters that China will take part in US President Joe Biden’s plan and use more if oil prices are above $85 a barrel and less if oil stays at $75.
Oil prices have already climbed above $80 a barrel due to supply disruptions in Libya and Kazakhstan, reducing US crude inventories to their lowest levels since 2018.
Additionally, there have been prospects for increased fuel demand in Europe, where governments have eased coronavirus restrictions.
In November 2021, the Biden administration discussed the issue with other major oil consumers, including Japan, South Korea, India, and China.
The US has already sold some of its crude oil from its reserves in these last few weeks. Japan and South Korea have also announced plans to sell it from their national reserves.
The plan, developed by Biden, will help increase the supply in the oil market by using oil from the strategic reserves of countries participating in the project. The US leader expects that the excess supply of oil will reduce the price of raw materials.
Be the first to comment